Over the head selfie collage4/15/2023 "Now we're pushing for closer to 24 months." Understanding why and where founders are spending money "Maybe in the past we'd look for 12 to 18 months of runway," Ahern said. KB Partners also wants portfolio companies to have bigger financial runways, meaning how long they can wait to raise more cash from investors. "We're definitely looking for companies that can turn on profitability a little bit more quickly," he said. Ahern said one thing that has changed is the firm is paying more attention to when company founders expect to turn the bottom line from red to black. KB Partners typically exits investments in five to seven years and invests in companies that have yet to turn a profit. "We're doing deals kind of how we always have."Īhern characterized the firm's investment approach as "conservative." Recent investments include the weighted-apparel company Omorpho and Tixologi, a blockchain-based ticketing platform. "We have $125 million that we've told our investors will be put to work over the next few years," Ahern said. The firm's first fund was about $40 million. How soon can startups reach profitabilityĬhicago-based KB Partners, which invests at the "intersection of sports and technology," recently closed a $125 million investment fund, the firm's second fund. Transactions that got done in 30 days last year could take 60 right now. She also said the firm is taking longer to close deals. However, she added that some of the group's angel investors have shifted funds from venture capital to real estate, a safer port in an economic storm. "We're still in the game and we're still investing," Delhagen said. It's now invested more than $6 million in about two dozen companies. It invested in Wild Rye, a women's outdoor apparel brand. Oregon Sports Angels, which marks its fifth anniversary in December, hosted a pitch day in June. If you can demonstrate a clear, obvious need for something, then it at least screens in based on that filter." "There's a big shift in mindset from nice-to-have to need-to-have. "A 'maybe' is now an easier 'no' for us," Delhagen said. When deciding whether to invest in a startup, Delhagen and Oregon Sports Angels recently added a new screening question: Is there really a need in the market for this company's product? That's the biggest quarterly percentage drop in the number of deals in a decade.ĭelhagen, Ahern, and Abbassian are still writing checks, but they're evaluating companies more carefully and keeping an eye on how founders are spending cash. With the economy rippling with uncertainty, Delhagen's investment strategy has understandably shifted. The same can be said for Steve Ahern of KB Partners and Path Ahead Ventures principal Payam Daniel Abbassian.Īll three investors are among a list of VCs who regularly invest in sports, health tech, and wellness companies.Īcross all industries, venture funding decreased 23% in the second quarter to $108.5 billion, across 7,651 deals, according to CB Insights. In January, Insider asked Delhagen, who invests in sports and technology companies through Oregon Sports Angels, for her 2022 investment outlook. "All the seismic plates are spinning at the same time," she said. Investor Kate Delhagen describes the current economy in terms a geologist would likely fear.
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